January 9th, 2012
In the slightly confusing insurance world, renter’s insurance is something of an oasis of clarity. Your landlord most likely has insurance, but it probably only covers the building that you're in. Renter’s insurance protects the property of those who rent their homes against theft and damages caused by accidents (fire) and natural disasters (hailstorms, lightning, wind).
Despite its intrinsic straightforwardness, renter’s insurance does offer some choices for consumers. Renters can work with carriers to set limits in terms of coverages and deductibles; higher coverage amounts and lower deductibles mean higher monthly payments.
Another interesting variable is the actual cash value (ACV) of belongings versus the replacement cost. Most items depreciate in value over time, so the cost of replacing them will exceed their ACV. Accordingly, replacement policies will be more expensive but will likely still appeal to those who are attached to their belongings, whether for sentimental or professional reasons. If you're not too attached to your stuff and like to keep things fresh, an ACV policy might be attractive.
One of the best options available to those who opt for renter’s insurance is personal liability coverage. This protects you against a lawsuit stemming from a visitor getting hurt at the property you rent. If someone slips on a puddle under your icebox and tears up her knee, you might be vulnerable to a lawsuit; renter's insurance can protect you. Most renter's policies include liability coverage but you should check with your provider just to make sure.
If your rental property is indeed rendered uninhabitable by an accident or natural disaster renter’s insurance can cover the cost of temporary alternative housing.
Renter’s insurance is a good way to protect your family and your belongings in the case of an accident inside the property you’re renting. It’s not terribly expensive, and can also be secured at a discount when bundled with our insurance types, especially automotive.